Government’s first quarter performance worrying – IMANI

Policy Tink Tank, IMANI Ghana has described as worrying government's inability to meet its set targets for the first quarter of 2017.

The assessment which was done based on government’s projections in the 2017 budget, revealed that government failed to hit its targets for import duties, non-tax revenue, and grants

The government missed these targets by 23, 21 and 53 percent respectively.

A release signed by the Founding President of IMANI stated that “revenue targets have been missed for the first quarter by 14 percent, of which domestic revenue fell short of the target by 12 percent. Company taxes, a component of the domestic tax revenue slipped off the target by 27 percent for the quarter, as other direct taxes missed the target by 7 percent."

"On the external economy, taxes on International Trade (specifically import duties) also missed the projection by 23 percent for the quarter. Non-tax revenue and grants were the biggest ‘culprits’ as the target were missed by 21 and 53 percent, respectively.”

The statement, however, lauded the government for controlling its expenditure and ensuring that there were no excessive overruns within the first quarter.

IMANI was emphatic that this will go a long way to ensure that government doesn’t put undue pressure on its expenditure in the remaining quarters.

Franklin Cudjoe was of the view that the government was voted in the 2016 elections because of some of its assurance to improve the economic outlook.

He insisted that the first quarter of the implementation of the 2017 budget outcome wasn’t impressive and the government needs to sit up in the coming months.

“The performance on revenue particularly domestic tax revenue for the first quarter raises concerns within the short term and is consistent with the fears of many observers of the economy. Without a significant recovery of real sector productivity, to drive the tax revenue over the next three-quarters beyond the government’s projections, efficiency and effectiveness of the 2017 economic plan could be undermined, with debilitating effects on other macro-economic aggregates.”

He recommended that for the government to make strides in its bid to create more jobs and an enabling business environment, it ought to identify and block all revenue loopholes.

He cited the Ghana Ports as an avenue where the State loses a lot of revenue that could have accrued into its basket.

“One major and immediate remedy will be for the government to close all the major revenue loopholes, especially those within our ports, which have been assessed to account for only 10 percent of their potential accrual.”